“Connect Earth helped us get useful information in the clearest way possible.”
Mathieu Pillet, Managing Partner, Head of Risk and ESG at Square Capital Group
Unedited answers from a customer interview with Square Capital Group: €1.6Bn AUM | Paris, London, Monaco, New York | Founded 2007 | Quality Investing.
Introduction & context
For those who may not be familiar, can you give a brief introduction to Square Capital, its history, and its core mission?
Square Capital was founded in 2007 by two former private bankers of Goldman Sachs. We are dedicated to families and entrepreneurs seeking personalized investment solutions. Additionally, we launched several investment strategies for our private and institutional clients: Megatrends Champions, our global equity fund, and Square Alternative Strategies, a fund of Hedge Funds.
What drove Square Capital to integrate sustainability into your investment decisions?
The Megatrends Champions fund targets companies benefiting from secular trends that will reshape economies on a longer horizon. One of our identified trends was the growth of regulations. Within this framework, green regulation is a strong driver: it just made sense to ally our investment approach with sustainability considerations. Governance principles were already a pillar of our investment strategy. Finally, the whole team firmly believes in the core values of sustainability.
You define “Quality Investing” using both ‘hard’ and ‘soft’ criteria. How does sustainability data, traditionally seen as ‘soft’ or non-financial, move into the ‘hard’ criteria category for your team?
We entered a partnership with Connect Earth back in early 2024 to provide us with tangible sustainability data for Megatrends Champions, our global equity fund. Before that, we relied on limited datasets from several providers, and our own analysis on portfolio companies. We liked the E, S, and G split, covering the global sustainability rating, as well as raw KPIs allowing us to have a clearer vision on the companies’ activities.
Addressing sustainability challenges with Connect Earth
What were the main challenges with sustainability reporting before Connect Earth?
Most of our analysis was made internally by the team, on our own work time, based on limited information. The scope of data we could use was undefined, and we were not able to provide consistent answers when filing reporting. The reporting time was removing precious time that would be dedicated to catering to our clients’ needs. Reporting was time consuming, inconsistent in its form and consistency.
What factors led you to select Connect Earth as your sustainability data partner?
We appreciated the approach of Connect Earth: transparent and down-to-earth communications on our first contacts. We were not pushed to a hefty data package that we didn’t need. The team understood our approach: they really tried to understand what we needed. At the time, the main focus was for us to cover all regulatory needs for the new version of the SRI label. The data platform was the clearest we have seen so far: clear sections, clear goals for those. Development ahead was promising.
Which modules have been most impactful, and why?
We mostly use the ESG module for our scoring process. The analysis is very insightful, and data export is at ease. We were easily able to upload our portfolio data on a daily basis. The PAI module is also very useful, as we can gather historical data from our portfolio and see clear trends. This job was much more manual with our former data provider.
How has Connect Earth’s automation affected your team’s workflow?
Connect Earth saved several hours of work each month for our process, making it much more reliable and stress-free. The API approach was key for us to automate everything. We liked the simplicity and coverage of the data, and the availability of index compositions. Transparency is also ideal, being on demand or provided on the premade PDF reports.
How was your onboarding experience?
We appreciated the fact that the team was there to help us in times of need, but at our own pace. We believe each user has their own goals from the platforms, and the goal of the partner is to inform us of what’s available. The moment we needed API access, Connect Earth delivered, with clear instructions and a ready-to-use solution.
Sustainability developments moving forward
What is your outlook on the current environment for sustainable investing?
Sustainable investing is threatened by the policies in the US and the AI revolution. We are seeing a shift in priorities from potential clients. We expect a degradation of the sustainability framework, but this will lead to more opportunities in the field.
Are there Connect Earth features or modules you’re excited to explore next, or that you’d like to see developed in the future?
The controversy module for us was the most impactful tool that we would have needed if we had kept the SRI label.
If you could influence the next wave of sustainability data tools, what would be at the top of your wishlist?
We think that an AI qualitative analysis for companies would be very interesting for our analysis.
If you had to summarise Connect Earth’s impact in one sentence, what would it be?
Connect Earth helped us get useful information in the clearest way possible.
About Square Capital
Square Capital is an independent international asset manager with offices in Paris, London, Monaco, and New York, specializing in Quality Investing.
Launched in 2007 by two former Goldman Sachs Asset Management Executive Directors, Square Capital now manages €1.6Bn of assets on behalf of its institutional and private investors.